Technological Perspective Survey (Task 2 Market Survey for ... · (Task 2 Market Survey for MECON Project) Dr. Kinnaleth Vongchanh1 Dr. Khamphone Nanthavong2 Faculty of Engineering,

Technological Perspective Survey

(Task 2 Market Survey for MECON Project)

Dr. Kinnaleth Vongchanh1

Dr. Khamphone Nanthavong2

Faculty of Engineering, National University of Laos

July 15, 2014

Effective energy efficiency policy implementation targeting

“New Modern Energy Consumer” in the Greater Mekong Subregion

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Table of contents

1. Introduction ..................................................................................................................... 5

2. Objectives ......................................................................................................................... 6

3. Methodology .......................................................................................................................... 6

3.1 Site description............................................................................................................. 7

3.2 Data collection ............................................................................................................. 8

4. Energy efficient appliance in market .............................................................................. 10

4.1. General information ................................................................................................... 10

4.2. Availability of electric appliances ............................................................................. 11

4.3. Knowledge and skill of staffs and customers about efficient products ..................... 13

4.4. Key barriers to selling products with energy efficient technology for households ... 16

4.5. Main drivers of selling energy efficiency products for households ........................... 18

4.6. Key to successful diffusion of EE products in market ............................................... 19

5. Conclusion and Discussion ............................................................................................. 21

5.1 Difficulty during the survey ....................................................................................... 21

5.2 Survey result accuracy ............................................................................................... 22

6. Acknowledgement ............................................................................................................... 22

References ................................................................................................................................ 23

Appendix A .............................................................................................................................. 24



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List of Tables

Table 3.1: Location and amount of survey samples .................................................................. 8

Table 4.1: Key barriers to selling energy efficiency products ................................................. 17

Table 4.2: Main drivers of selling energy efficiency products ................................................ 18

Table 4.3: Planning to expand business on EE products ......................................................... 19

Table 4.4: Key successful to improve of selling energy efficient technology ......................... 20

List of Figures

Figure 1.1: Population and GDP per capital in Laos. ................................................................ 5

Figure 1.2: Lao PDR’s GDP growth rate. .................................................................................. 5

Figure 1.3: Electrification connection ratio ............................................................................... 5

Figure 3.1: Map of Lao PDR ..................................................................................................... 7

Figure 3.2: Polo T-shirt and bag ................................................................................................ 9

Figure 4.1: Year of operating shops ......................................................................................... 10

Figure 4.2: Number of employees ........................................................................................... 11

Figure 4.3: Availability of electric appliances ......................................................................... 11

Figure 4.4: Percent share by product type groups.................................................................... 12

Figure 4.5: Percent share of lighting bulb type ........................................................................ 12

Figure 4.6: Percent share of cooking devices .......................................................................... 12

Figure 4.7: Percent share of conventional and energy efficiency for each product type ......... 13

Figure 4.8: The share of the shops with EE products service staffs ........................................ 14

Figure 4.9: Education background of the shops technical staffs ............................................. 14

Figure 4.10: Knowledge/skills level of technical staff related on EE products ....................... 15

Figure 4.11: Frequencies of staff training on EE products service ......................................... 15

Figure 4.12: Knowledge of customers on EE products ........................................................... 16

Figure 4.13: Preferences of customers on using EE products ................................................. 16

Figure A-1 1: Year of business operation ................................................................................ 25

Figure A-1 2: Type of business ................................................................................................ 25

Figure A-1 3: Main product type selling in the retailer ........................................................... 26

Figure A-1 4: Number of employee in the retailer .................................................................. 26

Figure A-1 5: interest in expanding its business in EE products ............................................. 26

Figure A-2 1: Number of employee working for installing and .............................................. 27

Figure A-2 2: Highest education of technical staff .................................................................. 27

Figure A-2 3: Knowledge/skill level of technical staff related on EE products ...................... 28

Figure A-2 4: Frequent of training on installation and maintenance on EE products for staff 28

Figure A-2 5: Knowledge/skill level of customers on EE products ........................................ 29

Figure A-2 6: EE product preference of customers ................................................................. 29

Figure A-2 7: Providing installation and maintenance service in retailer ............................... 29

Figure A-3 1: Type of AC sold in the retailer .......................................................................... 30

Figure A-3 2: Percentage of AC type sold in the retailer ........................................................ 31

Figure A-3 3: Ranking sale of AC capacity in retailer ............................................................ 32

Figure A-3 4: Energy label for AC product sold in retailer ..................................................... 32



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Figure A-3 5: Type of lighting sold in retailer ......................................................................... 33

Figure A-3 6: Percentage of each type of lighting sold in retailer ........................................... 33

Figure A-3 7: The best sale of each lighting type .................................................................... 34

Figure A-3 8: Ranking of selling lighting in retailer ............................................................... 35

Figure A-3 9: Main types of cooking devices sold in retailer.................................................. 36

Figure A-3 10: Energy label of cooking device sold in retailer ............................................... 36

Figure A-3 11: Percentage of each cooking devices sold in retailer........................................ 37

Figure A-3 12: Type Electric water heater sold in the retailer ................................................ 38

Figure A-3 13: Percentage of electric water heater sold in the retailer ................................... 38

Figure A-3 14: Ranking sale of electric water in retailer ......................................................... 38

Figure A-3 15: Type of pump sold in retailer .......................................................................... 38

Figure A-3 16: Percentage of pump type sold in retailer ......................................................... 39

Figure A-3 17: Ranking sale of pump in retailer ..................................................................... 40

Figure A-3 18: Type of TV type sold in retailer ...................................................................... 40

Figure A-3 19: Percentage of TV type sold in retailer ............................................................. 42

Figure A-3 20: Ranking of TV type sold in retailer ................................................................. 42

Figure A-3 21: Energy label for TV type sold in retailer ........................................................ 43

Figure A-3 22: Type of electric kettle sold in retailer ............................................................. 43

Figure A-3 23: Percentage of electric kettle type sold in retailer ............................................ 44

Figure A-3 24: Ranking sale of electric kettle in retailer ......................................................... 45

Figure A-3 25: Energy label for electric kettle sold in retailer ................................................ 45

Figure A-3 26: Type of iron sold in retailer ............................................................................. 46

Figure A-3 27: Percentage of iron type sold in retailer ........................................................... 46

Figure A-3 28: Ranking sale of iron type sold in retailer ........................................................ 47

Figure A-3 29: Energy label of iron sold in retailer ................................................................. 47

Figure A-3 30: Type of refrigerator sold in retailer ................................................................. 48

Figure A-3 31: Percentage of refrigerator type sold in retailer ................................................ 48

Figure A-3 32: Ranking sale of refrigerator in retailer ............................................................ 49

Figure A-3 33: Type of washing machine sold in retailer ....................................................... 48

Figure A-3 34: Percentage of washing machine type sold in retailer ...................................... 49

Figure A-3 35: Ranking sale of washing machine in retailer .................................................. 51

Figure A-3 36: Type of fan sold in retailer .............................................................................. 51

Figure A-3 37: percentage of fan type sold in retailer ............................................................. 52

Figure A-3 38: Ranking sale of fan size in retailer .................................................................. 53

Figure A-3 39: Energy label of fan sold in retailer .................................................................. 53



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1. Introduction

Energy demand and consumption in Laos are increasing following the population and

economic growth presented in Figure 1.1; a number and an income of population in Laos are

yearly increasing in Lao PDR, 6.4 million people and 14,340 million USD in year 2010,

respectively.

Figure 1.1: Population and GDP per capital in Laos (PPPUS$2005), [1].

Figure 1.2: Lao PDR’s GDP growth rate, [1].

Figure 1.3: Electrification connection ratio [1].



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By increasing of the GDP growth rate is quite high in recent year, around 7.01 % in

average from year 2000-10, as illustrated in Figure 1.2. More numbers people and income are

causing the higher requirement on energy/electric consumption; therefore, national grid has

expanded to almost all the country. Figure 1.3 shows the rising of electrified households

every year, the average electrified household in whole country is about 71.34% and 81.34%

year 2010 and 2013, respectively.

Energy consumption was estimated that total final energy demand of Lao PDR was

around 2.5 MTOE in 2011, with an annual increment of 3 to 4%, in parallel with stable

economic growth. Lao PDR has the target to reduce 10% of energy demand from BAU by

2030, EMM5. The Energy consumption in residential sector has the largest share in total

energy consumption (49%), followed by transport (27%), commercial (14%) and industry

(10%). Currently, the major sources of energy are firewood and charcoal (about 55%),

followed by petroleum products (25%), coal (11.6%) and electricity (8.7%), [1].

Energy efficiency (EE) which promotes the use of energy more efficiently is one

solution for energy consumption reduction and slower growing rate of energy demand.

Higher energy consumption in residential sector is the result of increasing number of

households adapting modern lifestyle and use more electrical appliances, such as: air

conditioner, refrigerator, cooking stove, washing machine, etc. Technology is getting

improved and as result, products’ energy footprint is getting better. Now a day, there are

many household appliances produced with more energy efficient technology.

For a successful implementation of energy efficiency measures in the country, more

energy efficient appliances must be widely diffused in the nation. To achieve that, consumer

market trend of and the barriers hampering the adaptation of energy efficient products must

be identified first. Therefore, a survey on the consumer point of view and selling condition of

the energy efficient and conventional products in Lao market has been carried out under the

MECON project.

2. Objectives

The survey aims to figure out the overall market status of energy efficient applicants

in comparison to the conventional ones, and the existing market barriers and the public

awareness on the importance of Energy Efficiency. The objectives of the survey include but

not limited to:

- Availability and spread of energy efficient technology in Lao market

- Suitability of energy efficient technology versus demand and market conditions

- Energy efficiency labels and overall quality levels

3. Methodology

Lao People’s Democratic Republic or Lao PDR in short, is located in the heart of the

Indochina, in Southeast Asia, between latitudes 14o - 22

o30’ N and longitudes 100-108

o E.



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Lao PDR shares a 505 km border with China to the north, 435 km border with Cambodia to

the south, 2069 km border with Vietnam to the east, 1835 km border with Thailand to the

west, and a 236 km border with Myanmar to the northwest. The country stretches 1700 km

from north to South, with an east-west width of over 500 km at its widest and only 140 km at

the narrowest point. Laos has around 1800-2400 hours of sunshine per year, rainfall 1400-

2000 mm per year, [7, LSB, 2012]. The atmospheric average humidity is between 54-96%.

Around 75-90% of the precipitation falls in the rainy season, from May to October, while in

the dry season, from November to April, accounts for only 10-25%. There is a sharp

difference in rainfall between regions.

3.1 Site description

The Vientiane capital city and three other provinces, namely Xieng Khouang,

Savannakhet and Champasak, were selected as the region for carrying the survey

(highlighted in green on a map in Figure ). Table 3.1 lists the number of site sample in

each area selected.

Figure 3.1: Map of Lao PDR

Xiengkhouang province is located in the North-Eastern part of Laos, with Phonsavanh

as a provincial center town and has mild humid subtropical climate due to its high

altitude (1100 m), clearly two seasons: warm-wet summer and dry-cold winter.

Average June temperature is 23.6 °C, average December (the coldest month)

temperature is 14.8 °C [5].

Vientiane capital is located in the upper central part of Laos and is the most densely

inhabited city in the country. Vientiane features a tropical climate with two distinct

seasons: monsoon hot humid (May-October) and warm dry (November-April).

Vientiane tends to be hot and humid throughout the course of the year, though

temperatures in the city tend to be somewhat cooler during the dry season than the

wet season, [3].

http://en.wikipedia.org/wiki/Humid_subtropical_climate

http://en.wikipedia.org/wiki/Tropical_wet_and_dry_climate



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Savannakhet is the most populated province of Lao PDR, featuring a tropical climate,

generally very warm throughout the year, with average temperatures ranging from 22 oC in January, to 29

oC in March. Savannakhet has discernible wet and dry seasons,

with the wet season covering April through October and the dry season covering the

remaining five months. The city sees on average roughly 1500 mm of precipitation

per year.

Pakse city is provincial center of Lao southern province Champasak, which has

a tropical savanna climate (Köppen climate classification Aw) with very warm

temperatures throughout the year. Temperatures are especially high in the months

before the monsoon season (March-April). There is a distinct wet season (April-

October) and dry season (November-March), [6].

Table 3.1: Location and amount of survey samples

3.2 Data collection methodology

This survey was to fulfill the MECON project’s TASK 2 objectives, aimed

investigating production and distribution of electric home appliances in Lao markets. Given

the facts that there is no production capacity of electric appliances in Lao PDR, the surveys

were focused on distribution of electric appliances only.

Referring to MECON project definition, the retailer shops are those, where possibly to

buy a piece of good. In this meaning, there are no wholesaler shops of electric appliances in

Lao PDR, and therefore, the surveys of Lao team were targeted retailers shops only. There

totally 105 samples were planned for the surveys. The highest number of the samples was

given to Vientiane capital, as it is a nation main economic hub and most products are

imported to Vientiane and then distributed to other provinces throughout the country.

In order to have the surveys running smoothly and required information would be

gathered, a preparatory works were carried out, including:

Survey location Number of samples (shops) Coordinates Actual Plan

Xiengkhouang 12 15 19°25′0″N 103°″E

Vientiane Capital 40 55 17°58″N 102°36″E

Savannakhet 9 15 16.54°N 105.78°E

Champasak 8 20 14.88°N 105.86°E

Total 69 105

http://en.wikipedia.org/wiki/Tropical_wet_and_dry_climate

http://en.wikipedia.org/wiki/Wet_season

http://en.wikipedia.org/wiki/Dry_season

http://en.wikipedia.org/wiki/Tropical_savanna_climate

http://en.wikipedia.org/wiki/K%C3%B6ppen_climate_classification

http://en.wikipedia.org/wiki/Wet_season

http://en.wikipedia.org/wiki/Dry_season

http://tools.wmflabs.org/geohack/geohack.php?pagename=Xiangkhouang_Province&params=19_25_0_N_103_30_0_E_type:adm1st_region:KH

http://tools.wmflabs.org/geohack/geohack.php?pagename=Vientiane&params=17_58_00_N_102_36_00_E_type:city(783000)_region:LA

http://tools.wmflabs.org/geohack/geohack.php?pagename=Savannakhet_Province&params=16.54_N_105.78_E_type:adm1st_region:LA

http://tools.wmflabs.org/geohack/geohack.php?pagename=Champasak_Province&params=14.883_N_105.866_E_type:adm1st_region:LA



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Gathering of Initial general information on importation and distribution of electric

appliances in Lao markets, from relevant government authorities, mainly Ministry of

Industry and Commerce (Departments: Export-Import management, Enterprises

registration), Ministry of Finance (Departments: Taxation);

Based on initial information, the numbers of samples for each target were then

identified;

Development of Lao version of the questionnaire, based on the questionnaire from the

task leader;

Prepared the souvenir: T-shirt and bag with MECON project logo (Figure )

Training of the surveyors: the students of the Faculty of Engineering (FEN/NUOL)

To get official letter of intention from DEAN of Faculty of Engineering for presenting

to Department of Industry and Commerce in each target province

Upon presenting the FEN/NUOL letter of intention to the Provincial Department of

Industry and Commerce, the survey teams will get necessary instruction and guidance

on required interview targets

Two approaches were planned for interviewing process, depending on times

availability or willingness of the shop owners/staffs:

1. Face-to-face interview: interviewer asks questions and to fills questionnaire him or

herself. It was found that 85% of the shop owners accepted this approach.

2. The questionnaire form will be left for the shop owner to fill in her/himself and be

collected by the team later.

Souvenir

Polo T-shirts and bags, shown in 3.2, have been prepared as souvenir for giving to the

shops participating in the survey. The souvenirs help encouraging more shops to participate

in the survey and also help to spread our messages to leverage people awareness on energy

efficiency and energy saving.

Figure 3.2: Polo T-shirt and bag

The actual number of interviewed shops was fewer than planned (69/105) due to the

following reasons:



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Some time it was not easy to find the shops owners, who willing to share their

opinions. Afraid of business confidential reveal /misunderstanding/times constraints

probably are among the reasons for denied request. Some questionnaire forms were

sent back blank.

Some filled questionnaires were not satisfied in term of filling errors and then were

rejected by MECON NUOL team.

4. Energy efficient appliance in market

4.1.General information

In term of electric appliances production, there are no producers in Lao PDR and thus,

almost all appliances are imported from other countries, mainly from neighboring countries

Thailand, China and Vietnam.

Lao socio-economic development has significantly increased since announcement of

economic reform from centralized planning mechanism toward free market orientation in late

1980s, especially booming since early 2000s.

As a rule, as living conditions being improved, demand on electric appliances and

devices has accordingly increased. This is certified by rapidly increasing number of electric

products shops, where almost surveyed shops started their operation within last 10 years long,

and 45% of them opened since recent 5 years (4.1).

The surveyed electric products shops in Lao PDR mostly are small and family type of

business. This can be seen from the number of employees of the shop (4.2), almost two third

of the shops employ fewer 5 employees or no employees hired at all (self-employed

business). The shops with more than 10 employees usually are brand products dealer.

Figure 4.1: Year of operating shops



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Figure 4.2: Number of employees

4.2.Availability of electric appliances

Usually most of electric appliances retailer in Laos sell mixed all kind of household

appliances, with dominance by the certain products type. As seen from the Figure , cooking

appliances can be found in 79% of the interviewed shops, 60% of the shops sell hot water

heater and so on. It was observed there are fewer shops with air conditioning, because, these

products, as a rule, require additional extension service, such as installation and after sale

maintenance, and therefore, likely are selling in specific shops rather than in a general one.

Furthermore, there were found fewer shops selling water pump, probably because national

water supply is available in most of the downtown residential areas and there are still less

high-rise buildings in Laos. There are also few of light shops (31%) because the only shops

selling lighting equipment were focused; in addition, home lighting (lamps) are commonly

available in construction shops which were not conducted survey.

When grouping the shops by four main appliances categories, such as lighting, air

conditioning, household appliances and cooking appliances, the shops with household

appliances dominance ranked highest (82.3%), followed by shops, selling cooking appliance

(55%), (Figure ). There are fewer shops selling lighting and air conditioning appliances here

probably are due the earlier mentioned facts on specific service requirement.

Figure 4.3: Availability of electric appliances



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Figure 4.4: Percent share by product type groups

The surveys also found that the most popular lighting bulbs are fluorescent tube and

CLF (Figure ). The shops selling incandescent bulbs are slightly lower and less than half of

the shops sell LED.

Figure 4.5: Percent share of lighting bulb type

Figure 4.6: Percent share of cooking devices



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The rice cookers are standing first in the cooking appliances assortment of the shops

(89%), then hot plate electric stoves (63%), (Figure ). LPG stoves are less popular in Lao

markets due to high cost of imported LPG products.

In relation to energy efficient products available in the shops, it was observed

interesting trend of higher shares (>50%) for lighting, AC, TV, pump, fridge, washing

machines and electric kettles. As seen from the Figure , these products are either [1] energy

consuming appliances (AC, pump, water heater, washing machine, and kettle), or (2)

common or long lasting for daily use (lighting, AC, TV, fridge, kettle). These facts somehow

have reflected current status of people awareness on energy saving or energy expenditures,

showing that people turn to use more energy efficient appliances.

Other important influencing factors include (a) easy market availability (these

products are easily found in Lao markets), (b) import sources (almost these products are

imported from Thailand, where achieved the most successful EE&C programs in the region),

(c) information sources (usually Lao people are aware about EEC measures and products

from Thai TV broadcasting, as there no language barrier). Such points are also reflected on

higher shares of some conventional products (lighting, TV, water heater, fans, iron, electric

kettle and cooking devices), which are commonly imported from different sources. Besides,

products costs as well as availability of national EEC measures and standards can also be the

other important factors to have such trend.

Figure 4.7: Percent share of conventional and energy efficiency for each product type

4.3. Knowledge and skill of staffs and customers about efficient products

Shop owner/employees

Figure depicts the number of the shops’ staffs, who can provide

installation/maintenance service of EE products. Most of the shops (59%), allocate 2 to 5



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staffs for providing EE product installation and maintenance services, while 21% of the shops

have only 1 staff or not at all. Very few shops do offer the competent EE products installation

and maintenance service by more than 8 staffs.

The surveys found that nearly half of the shop technical staffs have higher technical

and vocational education, and another half- have had only School education (Figure ).

Figure 4.8: The share of the shops with EE products service staffs

Figure 4.9: Education background of the shops technical staffs

About 66% of the shops said that their technical staffs have a good to very good

knowledge/skills on EE products service, while some shops (9%) have poor to very poor

(Figure ).



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Figure 4.10: Knowledge/skills level of technical staff related on EE products

However, only 17 or 68 or 25% of surveyed shops have provided training on EE

technology installation and maintenance for the staffs, of those, 4 shops (23%) provide

training on regular basis, e.g., in every month, 3 shops have once in every 3 months period

and remained 10 - from 6 month to one year period (Figure )

Figure 4.11: Frequencies of staff training on EE products service

Customers

When were asked about customer’s understanding on EE products, 51 of 68 shops

gave their opinions, as illustrated in Figure : 40 shops (78%) said that customers have

moderate to good understanding and knowledge on energy efficient products, while remained

(22%) said that their customers poorly know about the EE products. Even though some

customers do not fully understood about the EE products, but most of them (66%) have good

to very good preference for using EE products (Figure ).



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Figure 4.12: Knowledge of customers on EE products

Figure 4.13: Preferences of customers on using EE products

4.4. Key barriers to selling products with energy efficient technology for households

The results explaining the key barriers to selling products with energy efficient

technology are shown in the Table 4.

In the shop management, high price of EE products scored highest (3.22), followed by

benefits of EE products sale and potential market growth for EE products. Therefore, the

shops are less confident on potential market growth of EE products in the future because the

price is higher than the conventional one and thus, lower profitability from EE products

selling.

In relation to customers’ behavior, lack of customers’ awareness on importance of the

use of EE products is the highest ranking (2.96), then consumers’ understanding about EE

products and unfamiliar for users EE technologies. At the same times, the shops have pointed

out insufficiency of technical knowledge/skills for installing and servicing, as well as

marketing of EE products of their staffs.

Most of the shops agreed that there should significant political supports for increasing

demand on EE products in the country, particularly in term of legal regulatory framework



Page 17

enforcement and incentive measures, as well as intensive works in public awareness raising

campaigns.

Table 4.1: Key barriers to selling energy efficiency products

Barrier on selling EE

products

Not at

all

not

agree

so

so

agre

e

very

agree

No

answer

Average

score

1 2 3 4 5 0

Management

EE products are higher

price than the

conventional one

10 14 15 11 19 0 3.22

Benefits of selling energy

efficient technologies are

not quantifiable

13 11 22 10 13 0 2.99

EE products have a

potential growth market in

the future

17 12 16 12 7 5 2.49

Customers’ behavior

There is a lack of

awareness of the

importance of energy

efficiency

14 13 13 20 9 0 2.96

Customer does not

understand the important

of the EE products

13 18 10 15 12 1 2.88

Customers are not familiar

with EE technologies

14 21 16 11 7 0 2.65

Knowledge/Skills

Lack of skills for

maintaining and installing

EE products

14 16 16 10 13 0 2.88

Limited labor availability

for maintaining and

installing EE products

15 15 11 18 9 1 2.83

Policy

Authorities are not strict

in enforcing energy

efficiency and

environmental regulations

10 14 11 8 23 3 3.16

The government does not

provide financial

incentives to

production/importation

/utilization of energy

efficient technology

16 14 8 4 24 3 2.96



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Lack of government

policy to EE product and

strategy

25 7 11 8 16 2 2.67

4.5. Main drivers of selling energy efficiency products for households

Environmental Concern

In term of environmental concerns, the shops most have agreed that the key drivers

for them to sell EE products are reduction of energy consumption(scored highest 3.79), then

improvement of overall environmental performance, as well as lowered greenhouse and other

gases emission reduction (Table ). The compliance with governmental regulations on EE&C

scored lowest, as there is still lack of such regulatory framework in the country.

Table 4.2: Main drivers of selling energy efficiency products

Reason of selling EEP Not at

all

not

agree

so so agree very

agree

No

answer

Average

score

1 2 3 4 5 0

Environmental Concern

Reduced energy consumption 8 3 12 12 32 1 3.79

Improved overall environmental

performance

3 1 15 26 19 3 3.72

Reduced greenhouse gas

emissions and other gas

5 9 9 15 27 3 3.60

Improved compliance with

governmental regulations on

EE&C

27 4 15 9 8 6 2.26

Company Reputation and Profitability

Consumer attraction and

requirement

3 1 9 13 40 2 4.18

Profitable business 2 4 15 13 32 2 3.93

Improved reputation /

recognition of the shop

2 7 11 18 29 1 3.91

Expand business into new areas 2 4 13 17 26 4 3.74

Improved staff pride / morale 10 7 10 22 15 3 3.24

Improved communication and

service with customers

9 7 15 15 18 4 3.21

Long-term strategy for energy

efficiency

3 6 17 24 11 7 3.19

Competition

Distinguish business from

competitors

2 3 9 21 31 2 4.03

Local competition 3 7 14 14 29 1 3.82



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Company Reputation and Profitability

When asked about company reputation and profitability, it was found that consumers

attraction and requirement standing highest (scored 4.18 of 5.00), then come profitable

business (3.93) and improvement of the company reputation/recognition. Some shops see

opportunity for expending their business into new areas, or improvement of staffs’

pride/morale, as well as to improve communication and service with consumers. Long-term

strategy for EE was the lesser meaningful for the company. In terms of market competition,

the most important factor for the company/shops is distinguish business from the competitors

(scored 4.03 of 5), then local competition (Table )

Table 2.3: Planning to expand business on EE products

Planning to expand business on EEP Yes No

Number of shop 29 38

Percentage of shop 42.6% 55.9%

Some of the interviewees think about expending their business by the following reasons:

- In the future EE products will play more crucial role in Laos

- To make available good quality products in Lao market

- EE products are essential for reducing customers’ expenditure on energy

- Increase of power for export by saved electricity

- To make EE products dominant in the shop’s assortment

- To meet demand and requirements of the consumers

- To provide more options for consumers

The reasons of the shops owners, who would prefer to keep their shop at current situation:

- Family business, and usually there insufficient resources (both financial or human)

for expending the services

- Lack of efficient inventory control and business management

- Limited number of family members, who could take cares of the expended business

- Don’t want to be risky by the business expanding;

- Insufficiently developed EE products market, e.g., current consumers preference to

buy cheaper products;

-

4.6. Key to successful diffusion of EE products in market

In the Table presented the survey results on the factors that could potentially affect

successful diffusion of EE products in the society.

Information and training

In this relation, mostly the shops see necessary to reduce the costs gap between

conventional and EE products (scored 4.14), to disseminate proven EE products use benefits



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(4.03), or importance of energy efficiency and conservation (4.01). At the same times, there

should be more skillful workforce available in the market to perform the services with EE

products.

Policy support/measures

When were asked about the support measures, the shops (score 4.45/5.00) most wish

to see tax reduction for EE products and to get technical assistance by producer/dealer (4.06).

Besides, the support with soft loan or subsidies is also crucial for expending EE products

market. Fewer people see necessary to get financial support from NGO.

Table 4.4: Key successful to improve of selling energy efficient technology

Activity of selling EE product Not at all not agree so so agree very agree No

answer

Average

score

1 2 3 4 5 0

Information and training course

Narrow down the cost gap

between EE and conventional

products

0 4 15 12 37 1 4.14

Proved of using energy

efficient products

4 1 9 10 41 4 4.03

Advertisement on the

important of energy saving or

energy efficiency

2 6 9 14 36 2 4.01

More reliable and skillful

technical people on

maintenance and installation

of EE products

3 5 17 14 27 3 3.70

Policy support

Tax reduction 4 1 2 5 55 2 4.45

Technical support from

producer

5 4 2 14 41 3 4.06

Loans / subsidies for energy

efficiency technology

7 4 6 15 32 5 3.67

NGOs financial support 11 14 9 13 16 6 2.87

Others

Discounted / free expert’s

advice

1 5 7 12 41 2 4.19

Energy Fair (with technology

providers, advisors etc.)

8 1 8 10 41 1 4.04

Directory with energy

contacts (technology

providers, energy experts,

financers, government

agencies etc.)

0 8 16 17 26 2 3.80

Delivery, install and

maintenance service

3 8 9 17 29 3 3.75

EE product business networks 2 5 12 18 27 5 3.70



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Others

Furthermore, the shop owners have pointed out that expert’s advice for free or with

small charges, as well as organization of regular Energy show/fair would help better diffusion

of EE products in to the market.

Besides, availability of directory on EE products /service /programs /measures,

establishment of a reliable service and business network would also significantly improve

expending the markets for EE products.

5. Conclusion and Discussion

An improvement of living conditions of people has resulted in increasing demand on

electric appliances and therefore, number of shop selling electric products in Lao PDR

rapidly increased within the last 10 years and the shops with household appliances assortment

counted for the highest share. Furthermore, favorable electricity tariffs and rapidly achieved

ratio of national electrification are other reasons for increased demand on electric appliances.

Major retailer shops in Lao market are small and family business, and therefore,

lacking capacity to do the service with EE products, and mostly don’t want to expand the

business.

Another reasons, a lack of National regulatory framework, as well as any other EEC

promotional programs in Lao PDR probably is among the main barriers for successful

diffusion of EE products into Lao market. The shops usually have no incentives to sell the EE

products as they get lower profit margins.

In order to achieve more effective diffusion of EE products in to Lao market, there

would need some interventions and supports, including adoption of national EEC legal

framework, appropriate institutional and financial supports, to increase of national capacity as

well as public awareness on EE&C.

5.1 Difficulty during the survey

- Apparently some of the interviewees or the shop owners did not pay attention on our

interview, mostly claimed on times constraints.

- It seems that when looking at our solid questionnaire form, some of the shop owners

were “scared” and simply refused interviewing or the questionnaire returned blank,

- The questionnaire understanding was also problematic for some interviewees, and

therefore, questionnaire was incorrectly filled and thus, some of them were rejected

by our team.



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5.2 Survey result accuracy

Based on our observation on the obtained data and the overall surveying processes, we

conclude that this survey provides reasonable results. However, the described above

difficulties likely have interfered the credibility of the provided data:

It should be noted that the percent share in the shop between conventional and

efficient products were mostly answered estimate by the shop owner

Some shops do not want to share exact inventory data or have no interest to look

for that data;

Interviewers’ skills in asking or communicating with interviewees could be also

another factor that influenced the credibility of the results.

All above mentioned difficulties and problems have resulted in rather high rate of

failed questionnaires (69/105)

6. Acknowledgement

The MECON NUOL team would like hereby to express our sincere thanks to all

shops owners/staffs, who spent their valuable times to share the useful information and

experiences.

Finally, the team appreciated active participation of the students of Faculty of

Engineering for conducted surveys and gathered information.



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References [1] Ministry of Energy and Mine. (MEM 2010). Energy policy and planning department.

Vientiane, Lao PDR.

[2] Annual Meeting of the Asia-Pacific Parliamentary Forum. (APPF 2009). [Online].

http://www.na.gov.la/appf17/population.html. [Cite: 20 May 2014]

[3] Wikipidai [Online]. http://en.wikipedia.org/wiki/Vientiane. [Cite: 20 May 2014]

[4] Wikipidai [Online]. http://en.wikipedia.org/wiki/Savannakhet#Climate. [Cite: 20 May

2014]

[5] Wikipidai [Online]. http://en.wikipedia.org/wiki/Phonsavan. [Cite: 20 May 2014]

[6] Wikipidai [Online]. http://en.wikipedia.org/wiki/Pakse. [Cite: 20 May 2014]

[7] Lao Statistic Bureau, year book 2012. www.nsc.gov.la

.

http://www.na.gov.la/appf17/population.html

http://en.wikipedia.org/wiki/Vientiane

http://en.wikipedia.org/wiki/Savannakhet#Climate

http://en.wikipedia.org/wiki/Phonsavan

http://www.nsc.gov.la/



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Appendix A



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A-1 General information

Figure A-1 1: Year of business operation

Figure A-1 2: Type of business



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Figure A-1 3: Main product type selling in the retailer

Figure A-1 4: Number of employee in the retailer

Figure A-1 5: interest in expanding its business in EE products

59%

41% Yes No



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A-2 Knowledge and skill

Figure A-2 1: Number of employee working for installing and

maintaining EE product in retailer

Figure A-2 2: Highest education of technical staff



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Figure A-2 3: Knowledge/skill level of technical staff related on EE products

Figure A-2 4: Frequent of training on installation and maintenance on EE products for staff



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Figure A-2 5: Knowledge/skill level of customers on EE products

Figure A-2 6: EE product preference of customers

Figure A-2 7: Providing installation and maintenance service in retailer



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A-3 Product type sold in retailer

Table A-3 1: The best sale of each product type

Items The best sale

Unit Conv EFF

AC 12000 12000 BTU/hr

Hot water

heater 4500 3500 W

pump 300 300 W

TV 22 32 in.

electric kettle 2.5 2.5 L

Iron 1100 1100 W

Fridge 6 6.5 Cub

Washing

machine 10 10 kg

Fan 16 16 in.

Air Conditioner

Figure A-3 1: Type of AC sold in the retailer



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Figure A-3 2: Percentage of AC type sold in the retailer



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Figure A-3 3: Ranking sale of AC capacity in retailer

Figure A-3 4: Energy label for AC product sold in retailer



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Lighting

Figure A-3 5: Type of lighting sold in retailer

Figure A-3 6: Percentage of each type of lighting sold in retailer



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Figure A-3 7: The best sale of each lighting type



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Figure A-3 8: Ranking of selling lighting in retailer



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Cooking devices

Figure A-3 9: Main types of cooking devices sold in retailer

Figure A-3 10: Energy label of cooking device sold in retailer



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Figure A-3 11: Percentage of each cooking devices sold in retailer



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Hot water heater

Figure A-3 12: Type Electric water heater sold in the retailer

Figure A-3 13: Percentage of electric water heater sold in the retailer



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Figure A-3 14: Ranking sale of electric water in retailer

Pump

Figure A-3 15: Type of pump sold in retailer



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.

Figure A-3 16: Percentage of pump type sold in retailer



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Figure A-3 17: Ranking sale of pump in retailer

Television

Figure A-3 18: Type of TV type sold in retailer



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Figure A-3 19: Percentage of TV type sold in retailer

.

Figure A-3 20: Ranking of TV type sold in retailer



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Figure A-3 21: Energy label for TV type sold in retailer

Electric kettle

Figure A-3 22: Type of electric kettle sold in retailer



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Figure A-3 23: Percentage of electric kettle type sold in retailer



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Figure A-3 24: Ranking sale of electric kettle in retailer

Figure A-3 25: Energy label for electric kettle sold in retailer



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Iron

Figure A-3 26: Type of iron sold in retailer

Figure A-3 27: Percentage of iron type sold in retailer



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Figure A-3 28: Ranking sale of iron type sold in retailer

Figure A-3 29: Energy label of iron sold in retailer



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Refrigerator

Figure A-3 30: Type of refrigerator sold in retailer

Figure A-3 31: Percentage of refrigerator type sold in retailer



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Figure A-3 32: Ranking sale of refrigerator in retailer

Washing machine

Figure A-3 33: Type of washing machine sold in retailer



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Figure A-3 34: Percentage of washing machine type sold in retailer



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Figure A-3 35: Ranking sale of washing machine in retailer

Fan

Figure A-3 36: Type of fan sold in retailer



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Figure A-3 37: percentage of fan type sold in retailer



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Figure A-3 38: Ranking sale of fan size in retailer

Figure A-3 39: Energy label of fan sold in retailer

Documents

Technological Perspective Survey (Task 2 Market Survey for ... · (Task 2 Market Survey for MECON Project) Dr. Kinnaleth Vongchanh1 Dr. Khamphone Nanthavong2 Faculty of Engineering,